Saturday, Sep 25, 2010
(Adds details, background.)
BEIRUT (Zawya Dow Jones)--Saudi Arabia's food producer Savola Group Co. Saturday said it plans to acquire an additional 7% stake in its unit Al Azizia Panda United Co. from Fawaz Alhokair Group through a share swap.
Savola said in a statement posted on the Saudi bourse website the 7% is Alhokair's entire stake in Al Azizia Panda and that it also plans to acquire the 18.6% stake of A K Al Muhaidib and Sons Group in Al Azizia through a share swap as well.
As a result Al Azizia will be fully-owned by Savola compared with a current stake of 74.4%, according to the statement.
Savola said it will acquire the shares from Alhokair at their fair value amounting to 297.6 million Saudi riyals ($79.34 million) and against the issuance of priority shares in Savola for Alhokair.
Savola will also pay SAR20.74 million to Alhokair in return for relinquishing its right to buy an additional stake of up to 3% in Al Azizia Panda over three years, according to the statement.
In August, Savola said that it will buy Al Muhaidib's stakes in Savola's units against the issuance of 37.63 million shares in Savola to Al Muhaidib.
This will bring the total Savola shares that will be issued for Alhokair and Al Muhaidib to 46.34 million which will represent 8.48% of Savola's new capital once the two issues are completed, the statement said, adding the conclusion of the deals requires the approvals of the authorities and of Savola's shareholders and that Swicorp will act as financial advisor for the deals.
The move aims to support Savola's strategy to give more focus to the retail sector, Abdulraouf Manaa, Savola's managing director, said in the statement.
Retail giant Al Azizia Panda operates a chain of supermarkets and hypermarkets across the kingdom, while Savola is a multiline conglomerate with a focus on food production and distribution.
By Shikrallah Nakhoul, Zawya Dow Jones, +961 1 985757, shikrallah@zawya.com
Copyright (c) 2010 Dow Jones & Co.
(END) Dow Jones Newswires
25-09-10 0939GMT
